How much money is necessary to be happy?

 

A Nobel Prize winner in Economics thinks you can reach the peak of your happiness with 75,000 USD

Angus Deaton (2015 Nobel laureate) and fellow economist Daniel Kahneman concluded that earning more than 75,000 dollars per year will not make you happier on any given day. Magazines like Forbes picked up this study.

Their definition of happiness

Deaton and Kahneman believed that when you start earning more than $75,000, it becomes hard to increase your ability to do things that make you happier. Things “such as spending time with people you like, avoiding pain and disease, and enjoying leisure,” says a quote from the study collected in Business Insider.

Image: Jacqueline Munguía / Unsplash

Money can't buy you everything

When you reach the point where every basic need is covered, there is not much room to buy things that will make you happier. Your free time, health, or relationships stop improving at the same rate as your income.

Image: Sharon McCutcheon / Unsplash

The numbers in context

$75,000 a year is only a reality in rich countries. This kind of salary is almost impossible in a developing nation. Furthermore, Deaton did his calculations back in 2010. In a recent study, referenced by Business Insider, Wharton fellow Matthew Killingsworth increased the amount to $85,000.

Image: Roberto Junior / Unsplash

A disputed conclusion

Economist Seth Stephens-Davidowitz claimed that Dr. Killingsworth also debunked Deaton's idea. He found that it is possible to increase happiness after the 75,000-dollar mark. However, “you need to keep doubling your income to get the same happiness boost,” wrote Stephens-Davidowitz in the New York Times.

Millions of dollars can buy you a new happiness boost

Stephens-Davidowitz also suggested that the happiness boost can return when you hit the 8-million-dollar mark. “A study of thousands of millionaires led by researchers at Harvard Business School found a gain in happiness when a net worth rises above $8 million,” he wrote.

Money can't buy love

“But the effect was small: A net worth of $8 million offers a boost of happiness that is roughly half as large as the one from being married,” Stephens-Davidowitz added.

Image: Álvaro CvG / Unsplash

Source : https://bit.ly/3zjUcJ2

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